Labour steps cautiously up to difficult truths about the NHS

At last, a shadow minister says budgets would be tight and reform essential regardless of who was in power.

We know Labour loves the NHS. All British political parties are obliged to profess their undying devotion to the health service at routine intervals, but Labour, as the party that oversaw the creation of the NHS (and has, in recent memory, invested the most money in it) claims a special protective monopoly. Voters seem to recognise this and regularly award Ed Miliband’s party robust leads on questions of who is most trusted on the issue.

That advantage is sure to be extended as the government’s NHS reforms, combined with an unprecedented budget squeeze, reinforce the impression that the Tories inevitably succumb to vandalistic urges towards the health service.

Even without the Lansley reforms (now to be implemented by Jeremy Hunt, who has never knowingly inspired confidence in anyone apart, it seems, from the Prime Minister) the NHS would be causing headaches for the coalition.  The health budget may be “ring-fenced” but anything other than a real terms rise in spending feels, over time, like a nasty cut, given inflation in the cost of treatments and the growing demands of caring for an ageing population.

That would be a problem for Labour in government too although you don’t often hear opposition MPs advertise the fact. Why would they? Slamming David Cameron for trashing the NHS is an open goal for Ed Miliband; it would just complicate the goal-scoring manoeuvre to add mealy-mouthed acknowledgements of the immovable budget obstacles on the horizon. That, at least, is one argument and it has generally prevailed at the top of the Labour party.

There is another view, which is that the public are not fools and will, as an election approaches, expect to hear something about the opposition’s intentions towards the NHS other than “we wouldn’t be the Tories”. As I’ve argued (ad nauseam) in the past, a necessary step on Labour’s journey to governing credibility, especially with regard to fiscal responsibility, is being seen and heard to talk about innovation and reform of public services. This doesn’t have to be a macho breast-beating display of willingness to wield the axe. It just means demonstrating, by the deployment of some policy imagination, that Labour recognises the long-term obligation to find ways of getting more for less.

With that in mind, I was heartened to come across a speech yesterday given by Liz Kendall, shadow minister for social care. Not many people spend their weekends catching up on policy interventions by junior ranking shadow cabinet figures, so I suspect you may not have yet got round to reading this particular example of the genre. It is not the Gettysburg address, nor is it a complete exposition of Labour’s policy towards reforming the health service. As with everything else in Labour's agenda for government (with good reason, given the time still to run before an election) health policy is a work in progress.

Nonetheless, for those of us who try to decrypt dull Labour announcements, scouring the formless surface of cosy One Nation reassurance for signs of something that looks like progress towards a governing position, Kendall’s speech is a find.

She states, for example that:

The truth is that far more fundamental reform is vital if we’re going to meet the challenges of demographic and social change.

And that:

.. Whichever party is in Government and however much growth we get back into the economy, we’ve got to get far more out of the billions of pounds spent in the NHS into the foreseeable future.

Obviously true, and a few grades below rocket science, but refreshing to hear said aloud by a shadow cabinet minister.

Kendall clarifies, up to a point, Labour’s view on what would happen to the new NHS architecture currently being put in place by the coalition if Ed Miliband were prime minister.

If Labour wins the next election we will repeal the 2012 Health and Social Care Act but we will not force the NHS through another major re-organisation.

We don’t need new NHS organisations, we’ll simply ask those we inherit to work differently.

We’ll keep Clinical Commissioning Groups and Health and Wellbeing Boards, but ensure they work within a properly accountable national health service.

And what about this for a realistic account of how the opposition should behave towards hospital  reconfigurations (a euphemism for the movement of services out of hospitals, into the community, usually involving ward closures, demonstrations, angry public meetings, bad headlines etc.):

Whilst changes to local hospital services will always be difficult, Labour will not have a policy of blanket opposition to hospital reconfigurations like the Conservatives did at the last election.

That might be easy politics. But it wouldn’t be right in principle or in practice.

We will judge every proposal on its merits: whether it saves more lives, reduces disabilities, and improves the quality of care. The clinical case must be made and supported by the evidence, if the public as well as local MPs are to be convinced.

In other words, yes, sometimes wards and even hospitals will have to close if we’re serious about finding the most effective and efficient way to deliver modern health services. That is because vast old district general hospitals are a desperately outmoded way of looking after people, many of whom have chronic conditions that should be treated not in hospital beds but at home or at local clinics. Better still, such conditions should prevented or kept in check by lifestyle changes. It’s what nearly everyone who has looked at the long-term implications of health policy decides in the end, but you rarely hear opposition politicians say it because joining in the anti-closure demo is so much more rewarding in the political short term.

Kendall even talks about “innovation” in the health service and the need to take a non-dogmatic view of the role of private and voluntary sector providers:

For all the criticism you hear, there’s actually a huge desire and talent for innovation amongst NHS staff.

What they need is the encouragement, freedom and space to innovate. They need backing to experiment and take sensible risks, not rigid performance management from on high.

The private and voluntary sectors also have a vital role to play in bringing innovation and challenge into the system.

Of course private and voluntary providers must be effectively commissioned and regulated, within a properly managed system - not the free market, free-for-all that this Government is putting in place.

But it would be a real mistake to slip back into old ways of thinking, and attempt to block rather than encourage the benefits these services can bring.

To most people who think about the challenge of running a decent public sector on limited budgets, that is all perfectly sensible. It is also, however, by the standards of recent Labour party caution in the discussion of public sector reform and given the reactionary mood in some corners of the wider labour movement, quite a departure. Brave, even. A modest burst of level-headed realism from a shadow minister about the challenge of running services in straightened times, acknowledging the need for innovation and reform that might not always be popular at first - I wonder if it will catch on.

The Olympic opening ceremony celebrating the NHS. Source: Getty Images

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

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There's nothing Luddite about banning zero-hours contracts

The TUC general secretary responds to the Taylor Review. 

Unions have been criticised over the past week for our lukewarm response to the Taylor Review. According to the report’s author we were wrong to expect “quick fixes”, when “gradual change” is the order of the day. “Why aren’t you celebrating the new ‘flexibility’ the gig economy has unleashed?” others have complained.

Our response to these arguments is clear. Unions are not Luddites, and we recognise that the world of work is changing. But to understand these changes, we need to recognise that we’ve seen shifts in the balance of power in the workplace that go well beyond the replacement of a paper schedule with an app.

Years of attacks on trade unions have reduced workers’ bargaining power. This is key to understanding today’s world of work. Economic theory says that the near full employment rates should enable workers to ask for higher pay – but we’re still in the middle of the longest pay squeeze for 150 years.

And while fears of mass unemployment didn’t materialise after the economic crisis, we saw working people increasingly forced to accept jobs with less security, be it zero-hours contracts, agency work, or low-paid self-employment.

The key test for us is not whether new laws respond to new technology. It’s whether they harness it to make the world of work better, and give working people the confidence they need to negotiate better rights.

Don’t get me wrong. Matthew Taylor’s review is not without merit. We support his call for the abolishment of the Swedish Derogation – a loophole that has allowed employers to get away with paying agency workers less, even when they are doing the same job as their permanent colleagues.

Guaranteeing all workers the right to sick pay would make a real difference, as would asking employers to pay a higher rate for non-contracted hours. Payment for when shifts are cancelled at the last minute, as is now increasingly the case in the United States, was a key ask in our submission to the review.

But where the report falls short is not taking power seriously. 

The proposed new "dependent contractor status" carries real risks of downgrading people’s ability to receive a fair day’s pay for a fair day’s work. Here new technology isn’t creating new risks – it’s exacerbating old ones that we have fought to eradicate.

It’s no surprise that we are nervous about the return of "piece rates" or payment for tasks completed, rather than hours worked. Our experience of these has been in sectors like contract cleaning and hotels, where they’re used to set unreasonable targets, and drive down pay. Forgive us for being sceptical about Uber’s record of following the letter of the law.

Taylor’s proposals on zero-hours contracts also miss the point. Those on zero hours contracts – working in low paid sectors like hospitality, caring, and retail - are dependent on their boss for the hours they need to pay their bills. A "right to request" guaranteed hours from an exploitative boss is no right at all for many workers. Those in insecure jobs are in constant fear of having their hours cut if they speak up at work. Will the "right to request" really change this?

Tilting the balance of power back towards workers is what the trade union movement exists for. But it’s also vital to delivering the better productivity and growth Britain so sorely needs.

There is plenty of evidence from across the UK and the wider world that workplaces with good terms and conditions, pay and worker voice are more productive. That’s why the OECD (hardly a left-wing mouth piece) has called for a new debate about how collective bargaining can deliver more equality, more inclusion and better jobs all round.

We know as a union movement that we have to up our game. And part of that thinking must include how trade unions can take advantage of new technologies to organise workers.

We are ready for this challenge. Our role isn’t to stop changes in technology. It’s to make sure technology is used to make working people’s lives better, and to make sure any gains are fairly shared.

Frances O'Grady is the General Secretary of the TUC.